FAIL-SAFE:

  1. Shall secure and maintain a policy of insurance, certificate of insurance, surety bond or other appropriate form of indemnification to ensure payment of any valid claims under the EPP's, shall issue valid Contracts directly to customers upon receipt of DEALER's application(s) and requisite payment(s), and shall provide dealer with various production reports in the month following receipt of DEALER remittances.
  2. Shall furnish the DEALER with a Dealer Procedure Manual, Rate Schedules, Sales Brochures, Sample Contracts, promotional materials, forms and other supplies necessary for DEALER to implement and use the PROGRAM, and provide training materials outlining sales, service and office duties and responsibilities.
  3. Shall investigate and process claims presented by DEALER and arrange for the reimbursement of valid claims to DEALER, other repairing dealer, or DEALER's customer according to the terms and conditions of the applicable Contract.
  4. Shall have the sole authority and discretion in determining whether or not a claim should be honored in accordance with the coverage provided by any specific Contract, and to what extent the repairing dealer shall be reimbursed.
  5. Shall not be liable for any costs or expense incurred by DEALER, nor for the quality of any parts of workmanship, nor for any bodily injury or property damage, nor for any other liability of any nature whatsoever, other than those specified in the Contract.
  6. Shall, upon receiving DEALER's application(s) for an EPP, prepare an invoice for the amount due FAIL-SAFE, and will transmit by electronic means such invoice back to DEALER within 2 working days. Terms for invoices shall be "Net 10 days", and a late fee equal to 1.5% of the invoice price shall be added for any balance over 30 days, and for each additional 30-day period that an invoice remains unpaid.
  7. Reserves the right to reject any application for an EPP not received within 10 days of the sale date for the plan, or reject any DEALER's remittance for coverage not received within 30 days of the FAIL-SAFE invoice date.

DEALER:

  1. Agrees to abide by the terms, conditions and procedures as outlined in the Contract, Rate Schedule Guidelines, Dealer Procedure Manual, other written procedures, bulletins or other PROGRAM materials or notifications furnished by FAIL-SAFE from time to time.
  2. Agrees to, within 5 days of any contract sale date, report to FAIL-SAFE via internet, fax or other electronic means a fully completed Application for Protection, in the form provided by FAIL-SAFE for DEALER's use.
  3. Agrees to, within 10 days of receipt of any invoice for payment of a Protection Plan(s), remit a DEALER's company check, payable to "FAIL-SAFE", for the full amount of such invoice.
  4. Agrees to a 90-Day "NO COVERAGE" period, beginning on the date DEALER's check is received by FAIL-SAFE. This time serves as an "elimination period" to protect the insurer against any pre-existing problems. Any losses occurring within this 90-day period shall be the responsibility of the DEALER. (NOTE: This provision does not apply to "used" coverages; it impacts only "new" coverages that are sold within 90-days of expiration of the mfg. warranty.)
  5. Agrees that all current, and any new, sales, office and service personnel shall be required to read the Dealer Procedure Manual, paying special attention to the "Questions & Answers" and "Claims Procedures" sections, and they be required to review any on-line or video training modules available.
  6. Agrees that any repairs performed by DEALER's service facilities shall be guaranteed by the DEALER for a minimum of 90 days, and that any re-repairs occurring during such 90 days will be DEALER's responsibility.
  7. Agrees to implement an organized sales program within the dealership(s) whereby every customer purchasing a qualifying equipment product is an opportunity to purchase a FAIL-SAFE Protection Plan. Dealer understands that any lesser effort will provide FAIL-SAFE and its insurer adverse selection. In order to prevent such adverse selection, DEALER further Agrees and understands that minimum annual EPP production shall be based on ten (10) percent of eligible products sold by dealer or 25 EPP's, whichever is greater. Not meeting minimum annual production may subject DEALER to suspension, termination, or require a new Dealer Agreement, along with requisite fee, before being allowed further use of the FAIL-SAFE PROGRAM.
  8. Agrees to indemnify, defend and hold harmless FAIL-SAFE, its directors, officers, agents or employees (collectively, the "FAIL-SAFE Indemnified Parties") from and against any and all claims, suits, actions, liabilities, losses, damages and other costs and expenses, including reasonable attorney's fees, which any FAIL-SAFE Indemnified Party may sustain or incur, directly or indirectly due to or arising out of (a) any act or omission of DEALER or its officers, agents, representatives or employees in breach of this Agreement or in violation of any law or regulation; (b) any representation or warranty made by DEALER or any person with respect to any Contract or this PROGRAM that is not contained in the most recent version or written materials relating to the Contracts or this program provided to DEALER by FAIL-SAFE for use in marketing Protection Plans to DEALER's customers; (c) any defects in, or injuries caused by, any of the equipment covered by a Contract (excluding any payments required to be made by FAIL-SAFE under the terms of any effective Protection Plan); and (d) action by DEALER or its officers, agents, representatives or employees that are unrelated to any Contract or any actions of FAIL-SAFE. The terms of this Section shall survive any termination of this Agreement.

This Agreement may be terminated immediately by FAIL-SAFE for any breach of this Agreement by DEALER, or by either party giving thirty (30) days notice to the other party. In the event of termination, the terms herein shall continue in full force and effect in regard to all Contracts issued and paid for by DEALER while this Dealer Agreement was in force. Bankruptcy or acts of bankruptcy such as appointment of a receiver, receivership, or assignment for the benefit of creditors, or cessation of business by DEALER shall automatically terminate this Agreement.